European stocks have hit record highs as investors look past rising COVID-19 infections in Asia to new highs on Wall Street after U.S. lawmakers agreed a $1-trillion infrastructure bill.
The STOXX index of 600 European companies hit a record for an eighth consecutive trading session as more acquisitions and steady corporate earnings supported a positive economic outlook.
U.S. cybersecurity company NortonLifeLock said it agreed to buy London-listed rival Avast for up to $8.6 billion U.S. to create a leader in consumer security software. Dutch bank ABN Amro said it would resume paying dividends. Both announcements sent stock markets higher.
The MSCI all country index is now just below its all-time high as markets held their breath ahead of the U.S. Consumer Price Index (CPI) that measures inflation.
The data will likely prompt investors to update their bets on when the U.S. Federal Reserve will begin tapering or scaling back the huge stimulus it put in place to help the economy withstand the pandemic.
Economists polled by the Reuters news agency forecast that U.S. inflation rose 5.3% in the 12 months through July, versus 5.4% in June.
Meanwhile, Asian shares slipped on fears about the spread of COVID-19. MSCI's broadest index of Asia-Pacific shares outside Japan lost 0.4%, with South Korea falling 0.7% and Taiwan shedding 0.6%.
The Delta variant of COVID-19 is spreading quickly in many Asian countries, raising fears about local restrictions on travel and other activity hurting the economic recovery.
Japan's Nikkei bucked the trend, gaining 0.6% on brisk earnings, while Japanese bank shares benefited from higher U.S. yields.
The U.S. dollar was supported by rises in longer and shorter dated Treasury yields, which reached their highest levels since mid-July with yields on benchmark 10-year Treasury notes at 1.3608%.
Elsewhere, the stronger U.S. dollar and higher bond yields weighed on gold, but the precious metal recovered to gain 0.2%. Oil prices eased slightly in Asia on concerns about slower demand in China due to the spread of the Delta variant.
